Malaysia GDP Seen At 4.8 Pct In 2026 If West Asia War Ends By June -- Affin Bank
KUALA LUMPUR, May 12 (Bernama) -- Malaysia’s gross domestic product (GDP) is projected to expand 4.8 per cent in 2026, provided the West Asia conflict ends by June, underpinned by stable domestic demand, improving investment activity and ongoing economic reforms, Affin Bank Bhd said.
Group president and group chief executive officer Datuk Wan Razly Abdullah said these trends were unfolding alongside a broader shift in global investment flows towards Asia.
“Global assets under management have reached approximately US$147 trillion, with Asia accounting for close to US$40 trillion.
“This reflects the growing importance of Asia in shaping the future direction of global capital and economic growth,” he said in his remarks at the Affin Market Outlook 2026 here today.
Within this evolving landscape, Wan Razly said ASEAN was emerging as one of the world’s most strategically significant regions, as businesses diversify supply chains and reduce concentration risks.
He said the region continued to benefit from favourable demographics, a rising middle-income population, improving infrastructure and a relatively balanced geopolitical position amid growing global fragmentation.
More importantly, ASEAN is no longer merely responding to global change but is positioning itself as a key driver of long-term resilience, investment and sustainable growth, he added.
Within ASEAN, Wan Razly said Malaysia was well placed to benefit from these developments, given its structural advantages, including being resource-rich, food-secure and energy-capable.
He said Affin Bank expected inflation to remain manageable at around 1.7 per cent, although supply-side uncertainties could still exert some upward pressure on prices.
Meanwhile, monetary conditions remained supportive, with the Overnight Policy Rate held at 2.75 per cent. The ringgit, which strengthened to RM3.92 against the US dollar earlier this year, has remained resilient at that level despite elevated global uncertainties.
Affin Bank is targeting the local note to reach RM3.80 against the greenback by year-end, as it continues to rank among the region’s better-performing currencies, outperforming several peers amid a challenging external environment.
“Supported by improving growth fundamentals and sustained fiscal reforms, the ringgit recorded an outperformance of approximately 0.6 per cent against its relative index earlier this year,” he said.
At the same time, Wan Razly said Malaysia’s broader economic indicators remained encouraging despite heightened geopolitical uncertainty, with domestic demand holding firm, investment activity gradually improving and key sectors continuing to demonstrate resilience.
“The external sector has also remained supportive, with exports in 2025 averaging RM123 billion. In 2026, exports have already reached RM147 billion a month, touching a historic high in January 2026, or a 19.6 per cent year-on-year increase,” he added.
He said these indicators reflected improving investor confidence in Malaysia’s economic trajectory and reinforced the underlying resilience of the economy.
-- BERNAMA